Tax Answers

March 05, 1994

Here is an answer from members of the Maryland Association of Certified Public Accountants to a reader's tax question. The Sun will publish answers through April 15.

Q: I work for the federal government and frequently have temporary duty assignments in other states and countries. These assignments can be as little as a week or as long as several months. I was informed by a California official that if I work in a state, other than that of my permanent residence, for even a few hours, I owe tax to that state. This seems totally wrong, even though the official is in a department which deals in tax issues. I could understand if more than half of the year was spent in another state, but it seems cumbersome for short trips.

A: It's true that you may have to pay taxes on income that is generated while working in other states, but you will also receive a credit from Maryland so that you won't be taxed twice. The first thing to do is to look at boxes 16, 17 and 18 on your W-2 form to see what states your employer issued income from. This tells you where you need to file a return. If you are required to file returns in other states, you will also file a Maryland Form 502CR to get the tax credit.

Note that Maryland has reciprocal arrangements with Pennsylvania, Virginia, West Virginia and Washington, D.C., so that taxpayers only have to file returns where they are permanent residents.

The above advice is for general purposes only and is not intended as legal, accounting or tax advice. Specific situations may vary. Consult with a tax adviser for specific advice.

Readers may submit questions by phone, mail or fax. Selected questions will be answered in The Sun and The Evening Sun.

To ask a tax question by phone, call Sundial, The Sun's telephone information service, at (410) 783-1800. In Anne Arundel County call 268-7736, in Harford County 836-5028, and in Carroll County 848-0338. Using a touch-tone phone, enter 6120 after the greeting.

Written queries may be sent to TAX QUESTIONS, The Baltimore Sun, Business News Department, 501 N. Calvert St., Baltimore 21278. Fax questions to The Sun's Business News Department at (410) 783-2517. Callers are encouraged to leave their names and phone numbers should questions need to be clarified. Names will not be published. Questions will not be answered by phone.